Why At Times Being Reasonably Greedy Is Good For Your Wealth   Feb 21, 2019


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One of the best aspects of being a financial planner is the fact that you get to meet and interact with clients and understand their philosophy and outlook towards life, money and wealth.

At least 60% of PersonalFN' WPS (Wealth Planning Service) clients are in the late 50s to early 70s age group and their philosophy towards their wealth is simple - "The money should work hard for them, they don't want to invest in risky asset classes and a return of 8-9% on the portfolio would be enough." These clients are no longer greedy and just want sustainability of wealth.

Assuming that this philosophy resonated across all our WPS clients, I was in for a surprise (and shock), when I and my colleague, met our most loyal WPS client, Mr Bharucha (name changed).

Mr Bharucha (73), a retired private sector employee, was unlike any other WPS clients. Mr. Bharucha has been with PersonalFN, for the last 15 years. He has seen advisors come and go, has witnessed the stock market massacre of 2008 and the euphoria of 2014-15.

As we sat down to discuss his portfolio over a cup of tea, Mr Bharucha remarked, 'you know Deepika, I have been investing in the markets for the last 25 years. That's how long you have been alive", and we all burst out laughing.

It was true. Mr Bharucha was one of a kind. I still remember his opening statement to me, 'Deepika, I'm greedy. I don't want a return of 6-7%, I don't lose sleep over a small negative return. I have seen my portfolio incur a notional loss of almost 60% in 2008-2009, and I have seen an XIRR of 35-40% in 2014-15. All the ups and downs don't bother me, I'm in this for a long haul. Remember, I'm greedy. My age might indicate otherwise, but I want to be greedy and grow my wealth manifolds'.

I nodded my head in agreement. I was shocked to be honest. All through our lives, we are taught not to be greedy and to be content in what we have, but here was Mr Bharucha. Discontent and greedy at 73. And, there is a difference between being an opportunist and being greedy.

[Read: Is The Elixir Of Wealth Only For The Rich?]

Prior to the meeting, I had studied Mr Bharucha's equity mutual fund portfolio in detail and had circled out his evolution from a meagre investment of Rs 1,000/month investment in 1994 to his current Rs 11 Crore portfolio.

Table 1: The journey from Rs 1,000 to 11 Crore

   Year      Monthly Investment       Yearly growth   
1994 1,000 12,330
1995 1,250 28,373
1996 1,563 49,091
1997 1,953 75,684
1998 2,441 1,09,659
1999 3,052 1,52,898
2000 25,000 4,78,911
2001 31,250 9,10,314
2002 39,063 14,75,438
2003 48,828 22,88,015
2004 61,035 33,60,012
2005 1,00,000 50,67,079
2006 1,25,000 73,10,877
2007 1,56,250 102,39,537
2008 2,26,563 98,71,792
2009 3,28,516 106,42,160
2010 4,10,645 184,72,551
2011 5,13,306 293,94,760
2012 6,41,632 444,30,579
2013 - 510,95,165
2014 - 587,59,440
2015 - 675,73,356
2016 - 777,09,360
2017 - 893,65,764
2018 - 1027,70,628
2019 - 1181,86,222
Note: The return clocked every year is indicative and not constant year-after-year. The returns are subject to how the Indian equities fared in the respective years.


As you can see from the above table, even though he incurred a loss of -30% per annum on his portfolio in 2008-2009, he did not stop his monthly investments. He actually increased it by 45% in 2008-2009.

As if reading my mind, Mr Bharucha said, 'We are taught that contentment is the key. I disagree. Do you think Warren Buffett, or Jeff Bezos or Mukesh Ambani are content? They are greedy. And while I don't own multi-million dollar businesses, I don't see why we can't replicate their money ideals into our portfolio.'

'Warren Buffett, first created abundant wealth and now actively donates it, that's what I want to do as well. So, my investment objective is "to be greedy"', he remarked with a chuckle.

Warren Buffett would be proud of Mr Bharucha, he was greedy when others were fearful.

[Read: Worthy Mutual Funds To Decide Your Investment Success In 2019]

Continuing the portfolio discussion, I was impressed with the amount of knowledge Mr Bharucha possessed regarding the markets. He religiously read all the mutual fund news and magazines and often shared interesting titbits with his advisors.

'I believe in spreading knowledge. You see, with the onset of Robo advisors, the new millennial thinks that they can replace a human connection with a computer. They are wrong.'

When I pay your advisory fees, I pay for the human connection. I pay for a discussion of minds and ideas regarding growing wealth. I pay because you question my approach to wealth and I question your recommendations and the ensuing debate regarding the recommendations and the final outcome, gives me the required faith in making decisions when it comes to my wealth.'

'It's all a game of faith, Deepika. You either have faith in a company and its representatives, or you don't. There is no grey area when it comes to faith. I have full faith in your company's capabilities in managing my portfolio and making sure I stay reasonably greedy. I have full faith in your philosophy with money. You see, unlike me, you guys aren't greedy, he remarked and smiled coyly.

As the meeting came to a conclusion, Mr Bharucha remarked, 'I have referred PersonalFN to guys in many of my circles, but the fact is that my friends don't understand the concept of value advice. They often ask me what the portfolio churning ratio is and when I answer that the recommendations don't change often, they question the need of a wealth manager.'

I retort, 'you won't fire the pilot if he successfully manoeuvres the tough skies, and ensures a safe landing right? You would say, job well done. Similarly, the job of a wealth manager is not to churn the portfolio unnecessarily and fill his own pockets, his job is to manoeuvre the tough market conditions and help your portfolio reach its destination.'

Now your job is to grow this Rs 11 crore into 110 crore in the next 10 years! , he exclaimed.

After coming back to the office, I decided to be a bit greedy myself and realised that if I saved Rs 10,000 per month and increased it by 10% every year, I would create a bigger corpus that Mr Bharucha.

Table 2: The journey from Rs 10,000 to Rs 13 Crore

   Age       Year       Monthly Investment       Yearly growth   
25 2019 10,000 1,26,703
26 2020 11,000 2,79,343
27 2021 12,100 4,61,905
28 2022 13,310 6,78,914
29 2023 14,641 9,35,510
30 2024 16,105 12,37,527
31 2025 17,716 15,91,573
32 2026 19,487 20,05,140
33 2027 21,436 24,86,703
34 2028 23,579 30,45,852
35 2029 25,937 36,93,427
36 2030 28,531 44,41,675
37 2031 31,384 53,04,424
38 2032 34,523 62,97,279
39 2033 37,975 74,37,840
40 2034 41,772 87,45,948
41 2035 45,950 102,43,959
42 2036 50,545 119,57,051
43 2037 55,599 139,13,568
44 2038 61,159 161,45,403
45 2039 67,275 186,88,431
46 2040 74,002 215,82,987
47 2041 81,403 248,74,403
48 2042 89,543 286,13,613
49 2043 98,497 328,57,821
50 2044 1,08,347 376,71,252
51 2045 1,19,182 431,25,991
52 2046 1,31,100 493,02,919
53 2047 1,44,210 562,92,759
54 2048 1,58,631 641,97,245
55 2049 1,74,494 731,30,424
56 2050 1,91,943 832,20,112
57 2051 2,11,138 946,09,521
58 2052 2,32,252 1074,59,066
59 2053 2,55,477 1219,48,396
60 2054 2,81,024 1382,78,644


​I still remember his concluding words, 'Never say that you have enough money. When you are standing on a slope, the only way to not come down is to continue moving up, however slow the uphill journey might be, the key is to continue moving up.'

Like, Mr Bharucha, I'm going to continue moving up, however slow. As I said in the beginning of the article, the best aspect of being a financial planner is, you get to meet really great people who can alter your attitude towards money and the way you look at wealth.

With the help of clients such as Mr. Bharucha, over the last 18 years, we have amassed expertise in managing wealth and philosophy of wealth. Like Mr. Bharucha, you too can start with a minimal investment amount and create your fortune. And we can help you in your wealth creation journey, by manoeuvring through the dark skies and ensuring you reach your destination.

Connect with PersonalFN's Certified Financial Planners and Wealth Managers on 022-61361200 or write to info@personalfn.com. You may also fill in this form, and soon our experienced financial planners will reach out to you.

Till then, Happy Investing!

Author: Deepika Khude



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